Last year, rents rose only 1.9 per cent - well below the inflation rate - and rental yields, after expenses, have slumped to lows of about 2 per cent, says the Reserve Bank.
SMH
I'd kind of guessed that it would be low, but I had no idea it was that low. They say some silly stuff in the article, like the rental housing glut being reduced because renters will buy their own house now prices are effectively lower. But that doesn't make sense. Renters buying their own house reduces demand at the same rate it reduces supply, so it shouldn't affect the glut. The glut will only be reduced by population growth. And that will take a long time. I think NSW rental prices are still quite a bit higher than prices in other states, so people aren't likely to move here. In short, I don't think renters will be much affected at all. Investors will lose lots of money because they're all "negatively-geared and subsidising their investments" hoping for a price rise which won't come.
Good stuff.
No, I agree that it doesn’t make sense. Seems to me some renters will now buy houses that investors will sell etc so the number of people and houses in the market will be about the same. It’ll only change if more houses get built or if we don’t build houses and our population increases.
Janet / 11:11am / 9 April 2004
Why talk when I can blog comment? Love, Mum
Janet / 11:12am / 9 April 2004